Indemnity Escrow
Protects: Funds reserved for potential indemnification claims after closing.
Typical timing: Post-closing
Helps protect buyers and sellers by holding negotiated funds until applicable indemnification obligations are satisfied.
Business Escrow Services That Close Deals Faster
ADM’s escrow solutions are designed to help protect large balances while simplifying transactions.
ADM provides business escrow services designed to help deal teams securely hold, monitor and release transaction funds while keeping closings on schedule. As an independent, third-party escrow agent with more than 15 years of experience, ADM provides dedicated support, nationwide service and access to extended FDIC and NCUA insurance for large escrow balances.
Key Takeaways
- ADM serves as an independent third-party escrow agent for M&A, business sales and other non-real estate transactions.
- Escrow accounts can typically be established on the same day to help keep time-sensitive transactions on schedule.
- Large escrow balances can access extended FDIC and NCUA insurance through ADM’s financial institution network.
- A dedicated transaction specialist supports the deal from account opening through fund disbursement.
- Each party has real-time visibility into escrow balances and transactions through ADM’s secure online portal.
Talk to a member of our escrow team.
What are Business Escrow Services & How Do they Work?
Business escrow services use a neutral third party to hold transaction funds until the conditions specified in an escrow agreement have been satisfied. Unlike real estate escrow, business escrow is commonly used in mergers and acquisitions, business sales, private equity transactions and other non-real estate transactions where funds may need to be held before, during or after closing.
The buyer or other party deposits funds into the escrow account, ADM holds and administers those funds according to the escrow agreement, and funds are released when the agreed-upon conditions are met.
This creates a neutral layer between the parties, helping protect buyer and seller while allowing the transaction to move forward with confidence.
Protect Large Escrow Balances with Extended FDIC & NCUA Insurance
Large M&A and business transactions can place millions of dollars into escrow. Holding the entire balance at a single financial institution can leave funds above applicable federal deposit insurance limits uninsured.
ADM addresses this risk by providing access to extended FDIC and NCUA insurance through our nationwide network of participating banks and credit unions. Eligible escrow funds can be distributed across multiple insured financial institutions, helping protect larger balances throughout the life of the transaction.
Choose The Business Escrow Solution That Matches Your Transaction
ADM supports a range of non-real estate business escrow solutions designed around when funds need to be held, what obligations they protect and when they should be released.
Holdback Escrow
Protects: A portion of the purchase price retained for future obligations, earn-outs or adjustments.
Typical timing: Closing through post-closing
Provides an independent place to hold funds until specified post-closing requirements have been met.
Working Capital Adjustment Escrow
Protects: Funds associated with final working capital calculations.
Typical timing: Closing through final reconciliation
Keeps funds available while final working capital calculations are completed and the appropriate settlement is determined.
Earnest Money Escrow
Protects: Funds submitted to demonstrate commitment to an acquisition.
Typical timing: Pre-closing
Provides a neutral account for earnest money while the parties complete due diligence and work toward closing.
Good Faith Deposit Escrow
Protects: Deposits made during negotiations or due diligence.
Typical timing: Pre-closing
Safeguards deposits while providing both parties confidence that funds are independently held during negotiations.
Special Purpose Escrow
Protects: Funds tied to unique milestones, contractual requirements or transaction structures.
Typical timing: Based on agreement
ADM can support customized escrow arrangements for transactions that do not fit a standard escrow structure.
Talk to a member of our escrow team.
Why Private Equity Firms & M&A Attorneys Choose ADM as Escrow Agent
When a closing date is approaching, an escrow provider should simplify the transaction – not create another workstream for the deal team.
ADM combines independent fund administration with dedicated service and technology designed to keep parties informed throughout the transaction.
Fast Account Opening
Most escrow accounts can be established quickly once required documentation is complete, helping keep time-sensitive transactions moving.
Dedicated Transaction Specialist
Work with a dedicated ADM specialist from account setup and funding through disbursement and final release.
Independent Third-Party Administration
ADM serves as a neutral escrow agent, administering funds according to the agreed escrow terms rather than representing the buyer or seller.
Real-Time Visibility
ADM’s secure online portal gives authorized parties visibility into transaction activity and fund status throughout the escrow period.
Accurate Fund Disbursement
ADM supports ACH and wire disbursements according to the transaction’s agreed release instructions.
Protection for Large Balances
Access extended FDIC and NCUA insurance through ADM’s financial institution network for eligible escrow funds.
Client Testimonial
“As an owner partner of a business brokerage company, I have found The American Deposit Management Company an invaluable resource for helping with our business brokerage transactions.
We do not have escrow or trust accounts with our firm, and always ask 3rd party vendors to provide these services. This is now my go-to company to use when attorneys are not holding and managing funds.
They offer extended FDIC insurance and are incredibly timely and responsive, adding another layer of seamlessness to our transactions.”
Business Escrow Services Built Around Deal Roles
ADM works with professionals across the deal process, providing escrow support tailored to each party’s role in the transaction.
- Private Equity Firms
- M&A Attorneys
- Business Brokers
- Corporate Buyers & Sellers
ADM’s Onboarding Process From First Call to Funded Escrow
1
Schedule a Call with an Escrow Specialist
On this call, share the transaction details and escrow requirements with ADM. Our team will then walk through how our escrow accounts and disbursements work.
2
Open & Fund
After a decision is made to move forward with ADM, an online application will be sent to the seller and buyer. Once the application and required documentation is completed, ADM establishes the escrow account and provides funding instructions. Most straightforward accounts can be established same-day, helping keep your closing schedule on track.
3
Monitor & Report
Authorized parties can monitor fund status and transaction activity through ADM’s secure online portal while a dedicated specialist remains available throughout the transaction.
4
Release & Close
When the conditions established in the escrow agreement have been satisfied, ADM releases funds according to the agreed instructions.
Repeat transactions become even simpler. Once a firm has completed its first escrow with ADM, future transactions can benefit from an established relationship and familiar process.
Business Escrow Resources
Business Escrow Accounts: What You Need to Know
Understand how business escrow accounts work and when your transaction may require one.
Business Escrow for Mergers and Acquisitions
Learn how escrow can help reduce risk throughout an M&A transaction.
Escrow for the Purchase or Sale of a Business
Explore how escrow protects buyers and sellers during a transfer of business ownership.
How to Open an Escrow Account for Your Business
Understand the account-opening process and what to prepare before getting started.
Advantages of Business Escrow Services
Explore how an independent escrow agent can reduce transaction risk and simplify fund administration.
A Practical Guide to Business Escrow
Get a deeper look at how modern business escrow can protect transaction funds and simplify complex deals.
Learn how ADM supports escrow requirements for EB-5 investor funds.
Open a Business Escrow Account
An escrow provider shouldn’t be the reason a transaction slows down.
ADM combines independent escrow administration, access to extended FDIC and NCUA insurance, a dedicated transaction specialist and real-time account visibility to help deal teams protect funds, reduce uncertainty and keep closings moving.
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- One-day account opening for most transactions
- Access to extended FDIC and NCUA insurance
- Dedicated support from funding through release
- Secure online visibility into fund status
Whether you’re preparing for an acquisition, business sale, holdback or other complex transaction, ADM can help establish an escrow solution built around the deal.
If you are interested in working with ADM, please fill out the form below and a member of our escrow team will be in touch within one business day.
Frequently Asked Questions
What types of transactions require business escrow services?
Business escrow is commonly used for mergers and acquisitions, business sales, private equity transactions, indemnity obligations, holdbacks, earnest money deposits and working capital adjustments. Escrow may be appropriate whenever transaction funds need to be independently held until specified contractual conditions are satisfied.
Why use an independent escrow agent instead of a bank or law firm?
An independent escrow agent serves as a neutral third party and administers funds according to the escrow agreement. ADM does not represent the buyer or seller in the transaction, allowing the deal team to use a specialized provider focused on holding, monitoring and releasing escrow funds.
Are business escrow funds FDIC insured?
Deposits held at an FDIC-insured bank are insured up to applicable FDIC limits. ADM provides eligible escrow balances access to extended FDIC and NCUA insurance by distributing funds across its network of participating insured financial institutions. ADM itself is not a bank, credit union, the FDIC or the NCUA.
How long does it take to open a business escrow account?
Most escrow accounts can be established the same business day once required documentation is complete, helping time-sensitive transactions remain on schedule.
What happens if there is a dispute over escrow funds during an M&A deal?
ADM administers escrow funds according to the terms of the escrow agreement. If a dispute prevents the conditions for release from being satisfied, the applicable funds remain in escrow until the requirements for release outlined in the agreement are met.
Can ADM handle EB-5 or multi-state escrow transactions?
ADM provides nationwide escrow services for business transactions and also serves as an independent escrow agent for EB-5 investor funds. Transaction requirements can vary, so ADM works with the parties involved to determine the appropriate escrow structure.
